Wednesday, December 31, 2008

While 2008 has been a bleak year for the financial markets and the global economy, it has been very kind to open source, at least based on market share. A review of Net Applications data suggests that there has never been a better time for open source; however, as Google Trends data suggests, it's no longer enough to rest on one's open-source laurels.

Number of projects. In terms of sheer numbers of open-source projects, as well as traffic to those projects, open source was on a tear in 2008, with SourceForge alone increasing its hosted projects by 10 percent.

Operating systems. Windows, too, has been on a slide, though at 89 percent of the market, it's hardly in a weak position right now. Linux and Mac have both gained at its expense, with the latter taking a real bite (over 1 percent) out of the Redmond giant. But for Mac and Linux, the real market to watch isn't the desktop, but rather the mobile (or nearly mobile) market, where Mac and Linux have real consumer advantages.

Commercialization. 2008 saw Red Hat and Novell Linux (and JBoss, in the case of Red Hat) revenue jump dramatically, as Sun also saw Open Storage and MySQL revenue climb significantly. But the real story may be in private data. My own company doubled its sales (again), while I know from conversations with executives at SugarCRM, MindTouch, JasperSoft, and other open-source vendors that their sales were on a tear, too. Separately, we're still talking about relatively small amounts of money (under $50 million), but collectively...? Commercial open source is coming into its own.

Tuesday, December 30, 2008

2008 was an eventful, breakthrough year for many open source companies, and 2009 will be even more so, especially in terms of business purchasing patterns, software business model shifts, and enterprise software stack evolution. The current economic conditions will certainly prompt businesses to look more closely at alternative IT solutions -- and open source technology will be one of the big winners next year.

Here's a look at a few 2009 open source market predictions that I believe will re-shape the software market in the coming year.

Adoption of open source software will increase as the economy worsens. As the 2008 recession extends into 2009, it will change the software landscape, as the economic "shock" forces businesses to make structural changes to their IT strategies to drive down costs. Open source software eliminates up-front licensing costs and drives down the total costs of new projects. It also introduces competition that will be used by customers to improve their negotiating position with the oligopoly of proprietary software vendors that dominate the market. Open source companies will see stronger year-over-year revenue growth than the proprietary software sector. Our company, Ingres, an open source database provider, recently announced that 2008 revenues will grow by more than 25 percent over 2007 versus traditional industry software growth rates at 7 to 8 percent annually. Growth rates for propriety vendors will take a hit despite moves by traditional companies like Oracle to actually raise prices during the economic downturn. The company's 45 percent increase on its BEA acquired-WebLogic application server, for instance, is causing customer migration to JBoss' open source enterprise application server.

Open source adoption will accelerate across the full infrastructure software stack and into applications. As more companies seek innovative solutions that do more with less, they will follow the early adopters who 10 years ago pioneered the use of the Linux operating system and in recent years have been using open source throughout their infrastructure stack. Areas of significant infrastructure adoption include Application Servers, Messaging and Databases, especially for Java-based applications, which are standardized and relatively easy to port to open source solutions. At the application level, we'll see accelerating adoption of Business Intelligence (BI), Enterprise Content Management (ECM), and Enterprise Resource Management (ERP) solutions.

SaaS and cloud computing solutions will grow and pull open source with it. Software-as-a-Service (SaaS) and open source share the same attractive economic model with lower overall costs and, critical for this recessionary environment, they both have zero up-front capital costs and variable operating costs. Companies will continue to move to subscription-based services that allow them to get a better handle on their IT costs. Moving to these pay-as-you-go services will also let executive teams re-size their technology budgets to adapt to current economic conditions, or to their company's changing revenue streams. Both SaaS and open source will see growth in new adoption. And SaaS growth will also pull more growth in open source as it delivers the right economics for the SaaS providers. As more companies integrate both forms of software into their internal IT systems, we'll see more customers push-back against yesterday's proprietary licensing models. Together, SaaS, cloud computing and open source offerings will also allow entrepreneurs to start new businesses with very little capital, even during a recession.

Mergers and acquisitions of open source vendors will continue. M&A activities will continue to change the open source landscape as proprietary vendors acquire more open source companies, and as open source companies merge. In turn, these events will keep the investment cycles going, as recently witnessed by the late 2008 funding of companies including JasperSoft and Infobright, both raising $10 million during what is currently a nuclear winter in capital markets. We'll likely see the first open source application and/or open source Business Intelligence (BI) company get acquired. Red Hat and Sun may make acquisitions to further build-out their respective open source stacks, and Novell may use its cash from the Microsoft licensing deal to expand its open source footprint. Meanwhile, valuations will outpace industry averages but not reach the dizzying heights experienced during the last M&A wave in the mid-2000s.

Competition from open source will drive proprietary software vendors to take the first steps in changing their business models. The combination of an "economic shock" to established procurement habits and the availability of mature and proven "commercial grade" open source software stacks will make 2009 the year in which open source competition drives proprietary vendors to begin changing their business models. Customers who are substantially downsizing their businesses will no longer accept the "ratchet model," where software costs only go up because of the negotiating leverage of the large vendors. Expect proprietary vendors to start realigning their business models to customer preferences, initially by emphasizing their own SaaS offerings while fighting a strong rear guard action to protect their much larger proprietary licensing and support revenues. Customers will respond to economic challenges with more centralized procurement and strategic adoption of open source, which will improve their negotiating position by demonstrating their willingness to implement open source alternatives for important applications.Open source stacks emerge from strong market partnerships. Open source vendors will continue to join forces to create whole open source stacks and to offer certified and pre-configured solutions that substantially reduce staffing costs. These partnerships will create a better way to compete with existing providers by offering easier implementation than combinations of products from proprietary software behemoths like IBM, Oracle and Microsoft. Customers will recognize and experience the cost benefits from hardware through software infrastructure right up to the application layers of their entire technology stack. For example, a Red Hat, JBoss, and Ingres stack will be available for Java application developers, and a competing Sun stack will be offered to existing Sun and MySQL customers. JasperSoft will partner with open source database providers to create a complete data mart solution to make business intelligence initiatives affordable for newly constrained budgets. These and many other partnership-driven open source stacks will provide competition and spur innovation that opens up important new choices in the software marketplace.

Systems integrators will guarantee first-year cost savings for migrations to open source. Look for offerings from the many global systems integrators who have strong balance sheets, experience with open source and are wrestling with how to maintain growth over the next few years. Businesses that want to move to lower cost and variable cost platforms, but don't want to deal with first year capital costs to do so, will be offered a way through global systems integrators. These companies will use their balance sheets to pay for their customers' transition to open source as part of multi-year contracts to "migrate, innovate and operate". Systems integrators have the financial strength and pricing methodologies to propose fixed price multi-year contracts for migration and operations to their customers and in many cases to fund innovation as well. These offerings will cover a spectrum -- from migration to a fully managed service, to migrations followed by on-premise support and maintenance services.

Monday, December 29, 2008

Here's my pick of five trends in open source as we head into the new year. Let me know your thoughts.

There's been quite a few good posts recently on trends and observations around open source. Here's my quick take on five trends that I expect will become more significant in 2009.

More commercial open sourceAs Dave Rosenberg has deftly pointed out, open source has become more commercial with the traditional view that you could give away software and sell support now being supplanted. CIOs and CTOs are a pragmatic bunch, and they aren't going to pay for support just because vendors ask for it; they'll pay for things that add value to their operations. My personal view is that for any trend or technology to be sustainable, it needs to be commercial -- which leads to the next trend...

More experimentation with business modelsWhile Red Hat has been successful with its enterprise subscription model, there are many variations in the industry. Companies like Alfresco, Pentaho, SugarCRM, and MySQL all have their own unique way of doing things. At MySQL, the core server is completely open source, but there are additional capabilities delivered as part of the subscription. Others, like Pentaho and SugarCRM, have closed source features in their enterprise product. I believe there will be more and more experimentation in business models in the next year as companies determine exactly what provides the right incentive or add value for users to become paying customers.

Sunday, December 28, 2008

In a bleak year, open source employment stayed relatively strong, as did the demand for Cobol skills

Journalists are often the bearers of bad news; it simply comes with the territory. And with the economy in the tank, there's no shortage of ugly stories to cover. So I'm always pleased when there's a legitimate bit of good news to write about. And counterintuitively enough, three of my columns this year contained good news about employment for techies, despite the downturn.

Open source jobs remain in good shapeIn July, I looked at a report that showed that as many as 15 percent of the available IT jobs call for open-source skills. Although the report was written before the financial meltdown gathered steam, it still turned out to be a good indicator of the job market.

I know that because several months later, a careful look at the layoffs cascading though Silicon Valley showed that few of the job losses -- and there were many -- took place at companies primarily focused on open source.

Friday, December 26, 2008

There's no question that the open source community is a passionate one -- and one with significant influence on technology directions and options. We're way past the days when people asked if Linux or Apache was safe to depend on in business. Open source is now a mainstream part of the technology fabric.

Yet it remains connected to its roots around a passionate community working together to solve problems and share the fruits of their labors with others. Any endeavor based in community is bound to spark passionate debate. After all, without contention, how else to determine the best way forward?

Since its emergence, open source has embodied this spirit. Part defiant, part self-reliant, and often outspoken and opinionated, those immersed in the community have worked both in tandem and at odds, all with the intention of pushing the movement in as many worthwhile directions at once.

It's so worthwhile that the drumbeat of business can now be heard in nearly every corner of community, drawing the attention of vendors and capitalists alike. And with greater attention and potential has come a measure of added strife. Questions of selling out and just desserts surface more frequently, yet not to the jeopardy of the endeavor, as the code keeps proliferating, thanks to those who participate.

Given the increased reliance on open source by users and commercial vendors, as well as by the commercialization of some open source projects, InfoWorld spoke with 11 thought leaders in a roundtable discussion about the current open source climate to uncover the most vibrant themes and conflicts shaping open source today.

Tuesday, December 23, 2008

The rise of Web 2.0, Software as a Service and cloud platforms has been a boon for open source software products and projects. Ongoing innovations are expanding the role of OSS in enterprises as well as individual users.

A quiet battle of sorts is taking place behind the scenes in the software industry. Software as a Service (SaaS) and cloud computing Consolidate Mac Servers. Run Windows Server on your Mac. Watch a Demo or Download a Trial. have evolved, placing much more attention on Web-based applications.

This greater focus has also raised expectations for the services delivered via Web 2.0. The open source Linux MPS Pro Focus on Your Business — Not Your IT Infrastructure. Latest News about open source software community has responded to this growing demand for a software-driven Internet by building some of the leading Web apps available.

"I'm seeing more innovation in open source in this area. I'm not seeing closed source developers getting into this. Instead, they are relying on Microsoft (Nasdaq: MSFT) Latest News about Microsoft and [other] proprietary developers," Aaron Fulkerson, cofounder and CEO of MindTouch, told LinuxInsider.

This technology from open source developers will encourage the next wave of innovation for the Web, he noted.

Monday, December 22, 2008

While some might argue that it’s too early to call, Red Hat’s open source model seems to be paying dividends despite the soft economic climate. Could penny-pinching managers looking for cheap solutions be a boon to the open source industry?

Red Hats revenue grew 22 percent to $165.3 million in the third quarter over the same period last year. This resulted in net income of 24 cents per share which beat Analysts’ expectations of 18 cents a share.

In fact, Red Hat’s position was solid enough that it took the opportunity to repurchase six percent of its outstanding shares, strengthening its position by approximately $11 million. The company is planning to continue buying up stock to shore up the company’s resistance to the recession.

Red Hat CEO Jim Whitehurst find that in a, budget-constrained environment, IT professionals are adopting open source and more specifically Red Hat to save money and enhance their competitiveness.” By building their operating system on code contributed by the open source community, Red Hat’s Enterprise Linux is a more cost effective server than proprietary alternatives.

Sunday, December 21, 2008

When Microsoft Corp. bought Powerset Inc. in July, it acquired more than just search engine technology. It also became the owner of open-source code that was -- and still is -- being contributed to the Apache Software Foundation's Hadoop project.

Having open-source technology in a product was a first for Microsoft, said Robert Duffner, a senior director in the company's platform strategy group. Also in July, Microsoft began providing internally developed code to an open-source project called ADOdb, which produces a database abstraction library for the PHP and Python scripting languages.

Via such moves, the platform strategy unit is pushing the software vendor not only to accept that its products need to interoperate with open-source technology, but also to view the latter as beneficial to its business goals.

Friday, December 19, 2008

On Thursday Oracle, one of the strongest enterprise software vendors, reported weak earnings, as reported by The Wall Street Journal. Most troubling is Oracle's first year-on-year decline in new software sales in five years, with license revenue falling by 3 percent from 2007.

Some of Oracle's struggles relate to a strengthening dollar, as CNET suggests. But with more than half of its revenues coming from maintenance, Oracle needs to forage for new customers paying for new license deals, rather than simply consolidating the industry to buy its way into new customers.

In short, Oracle needs to expand its open-source strategy.

By this I'm not referring to Oracle's work with open-source projects. Though I've harshly criticized Oracle on this score in the past, Oracle contributes significant resources to advance a range of open-source projects, as it details in its "Oracle Corporate Citizenship Report 2008" (PDF):

Thursday, December 18, 2008

Rounding up the top stories in the open source world starts with one very big deal.

Some might argue it was a middling year of news about open source and the Linux operating system. Whatever the sentiment, 2008 proved another year of solid growth and new releases for open source and Linux vendors.

In our week-plus look at the top stories, trends and themes of 2008, we pause to look at how some of them played out with vendors and end-users.

Sun Buys MySQL

Sun's $1 billion acquisition of open source database vendor MySQL was one of the biggest open source stories of the year. The deal, announced in January, closed just over a month later on February 26th.

The deal put MySQL at the forefront of Sun's database plans, shaking up its relationship with the open source PostgreSQL database and losing their PostgreSQL lead.

The acquisition also inspired some closed source hysteria when Sun pre-announced the release of MySQL 5.1 in April. As it turns out, MySQL 5.1 was substantially delayed and did not get released until December.

Wednesday, December 17, 2008

Seeker, I seek not to "state" anything. I am just trying to get the message across to many other net users that are a lotless savvy than you that the latest exploit in Internet Explorer have simply made using the software a game of Russian Roulette on the highways of the net. Especially if you use internet banking.

I find it diificult to understand why you are so staunchly defending the use of Internet Explorer when we both know that the latest vulnerabilities are not the usual second tuesday "patch" cycle issue. Microsoft itself has advised people NOT to use Internet Explorer for secure web surfing until this is fixed.

Let me ask you a question. Are you using Internet Explorer with the current vulnerabilities unpatched in full administrator mode surfing the net at random and then using the same machine and administrator user account to do internet banking with your whole life savings in the balance?

Tuesday, December 16, 2008

There's a long standing argument over the differences between "open-source" software and "free" software. But, a more common error outside of software ideology circles is that you can use open-source software anyway you please. Nope. Wrong. It's never been that way.

Cisco, the networking giant, should know better than this, but they've worn out the FSF's (Free Software Foundation) patience. So, Cisco is now being sued by the SFLC (Software Freedom Law Center) on behalf of the FSF for Linux and other GPL copyright violations.

You see, Cisco, like many other networking companies use Linux, and other free software programs like GCC, binutils, and the GNU C Library in their products. Specifically, Cisco uses these programs in its Linksys line. In fact, the FSF first brought Cisco's improper use of open-source code to the company's attention back in 2004 with its use in the Linksys WRT54G wireless router.

Monday, December 15, 2008

Adobe Systems is learning the challenges and complexities of taking its software open source.

Just a year and a half after Adobe released its Flex Software Development Kit (SDK) under the Mozilla Public License (MPL) to encourage developer buy in, it's the company - not the community - that continues to shoulder the burden of building and fixing Flex.

The majority of Flex committers are Adobe employees with most contributions from outsiders tackling bugs rather than going into new feature ideas.

Adobe, meanwhile, is treading a fine line between tipping off competitors to its Flex plans through the open-source work while coaxing the community to buy into the Flex roadmap.

When it announced it was open sourcing Flex in April 2007, Adobe called the move a way of collaborating with the developer community to "further fuel its momentum and innovation." Flex is one of many Adobe's code to go open-source, following - among others - Tamarin and BlazeDS. The main prize, Flash Player, remains closed.

Sunday, December 14, 2008

In the last major economic downturn, Linux established itself as a widely-accepted enterprise operating system, benefiting a lively ecosystem of vendors such as Red Hat and Novell. The return of tough economic times puts the open source alternative again front and center, this time with focus on databases and higher-level software applications.

I believe we've entered another era for open-source companies of all stripes. IT decision makers need to fight the financial crisis and they need a more efficient solution for critical enterprise system and IT needs.

As IT costs grow and the economic crisis puts pressure on global IT budgets, open source becomes irresistibly attractive to developers and IT decision makers who are being asked to do more with a whole lot less. Meanwhile, proprietary vendors react by increasing license fees by 15 percent to 45 percent, they continue to lock-in their customers, and they take away independence regarding choice and flexibility across the enterprise technology infrastructure.

Friday, December 12, 2008

In a truly open market the battle to set new mobile standards would be fairly clear.

It’s not, because this is not an open market.

In an open market we could await the Microsoft Zune phone, a host of Android kit, whatever LiMo and Symbian decide to come up with, along with RIM and Blackberry devices running on the networks of our choice.

In an open market this would sort itself out in Internet time. Equipment makers might mix-and-match features among the various open source offerings.

I personally don’t think closed source would stand much of a chance in the long run, although I would enjoy being proven wrong

Thursday, December 11, 2008

In 2009, Microsoft will continue its gradual acceptance of open source software while at the same time it works to dispel old prejudices against non-proprietary software from within the company.

Part of that acceptance will mean more work with open source project groups, according to Robert Duffner, the director of platform strategy at Microsoft, In October, Microsoft joined the Advanced Messaging Protocol (AMQP) working group, an open source project which originated at J.P. Morgan Chase & Co. as a means of developing a standard for high-speed messaging.

Microsoft will also pick up its activity in the Apache QPID project, which it also joined this fall. QPID is a messaging implementation built on AMQP. Microsoft became a sponsor of the Apache Software Foundation in July.

Wednesday, December 10, 2008

Building on 25 years of open system innovation and leadership, Sun announced its first open storage product line - 'Sun Storage 7000 Unified Storage Systems' radically simplifying the way enterprises manage their storage with breakthrough cost savings, speed and scale. "This new innovative product line is part of Sun's Open Storage business - the business that grew more than 100% this past quarter," informed Jagannath A.L, GM-Marketing, Sun Microsystems India. With more than 7.7 lakh developers from India being part of Sun Developer Network, the vendor expects to see tremendous open source community growth from India in near future. "Sun is the only vendor open sourcing storage software, with a choice of operating systems, middleware, and devices on extremely scalable, modular hardware to meet industry needs. These eco-friendly storage solutions help enterprises store more data in less space, manage more with fewer people, protect their investments and reduce their environmental impact,"he said.

Sun Storage 7000 Unified Storage Systems offers comprehensive data services at no extra cost, such as snap/clone, restore, mirroring, RAID-5, RAID-6, replication, thin provisioning, iSCSI and other features. As per Jagannath, a major shift occurring in storage marketplace that will change buying trends of storage. "Similar to server/Linux movement a decade ago, the storage industry is going through a similar shift (open source software on industry standard hardware) that will transform the US$40B proprietary storage market. Sun is leading the charge, and we believe customers, small to large will be interested in our technologies providing market differentiation, solid performance, easier set-up/management and lower costs,"he said.

Tuesday, December 9, 2008

The sponsors hope the program will ultimately promote their goals of greater freedom in the open source community to expand the Linux platform.

Open Invention Network (OIN) unveiled a program Tuesday that aims to make it easier for patent and trademark office examiners -- and others -- to access prior art, increase the quality of patents granted, and decrease the number of poor quality patents.

The Linux Defenders program, sponsored by the Software Freedom Law Center and the Linux Foundation, is designed to address intellectual property concerns about meritless patents for the Linux and open source community. The program solicits prior art to help invalidate and reject poor quality patent applications and patents, while encouraging high quality inventions and defensive applications.

"Linux Defenders offers the Linux and broader open source community a unique opportunity to harness its collaborative passion, intelligence, and ingenuity to ensure Linux's natural migration to mobile devices and computing," Keith Bergelt, CEO of OIN, said in a statement released Tuesday. "This landmark program will benefit open source innovation by significantly reducing the number of poor quality patents that might otherwise be used by patent trolls or strategists whose behaviors and business models are antithetical to true innovation and are thus threatened by Linux."

Monday, December 8, 2008

Chances are, your IT shop uses open source software (OSS). Indeed, the overwhelming majority of enterprises use OSS in some part of their organization -- and therein lies the problem. If you do use OSS, market watcher Gartner Inc. recommends you have an official OSS policy. But a surprising number of open source adopters are operating without one.

Eighty-five percent of respondents to a recent Gartner survey report they've adopted open source solutions. Of these, more than two-thirds (69 percent) say they haven't yet implemented policies for formally evaluating or cataloguing the use of open source assets in their environments. One upshot, the consulting firm warned, is that adopters that haven't codified official OSS policies are leaving themselves exposed to intellectual-property (IP) infringement violations.

"Just because something is free, doesn't mean that it has no cost," said Laurie Wurster, research director at Gartner, in a statement. "Companies must have a policy for procuring OSS, deciding which applications will be supported by OSS and identifying the intellectual property risk or supportability risk associated with using OSS. Once a policy is in place, then there must be a governance process to enforce it."

Sunday, December 7, 2008

he now-official recession has hit many corporations hard in the wallets, and that's being reflected in IT budgets. With fewer dollars to work with, IT managers are increasingly turning to open source software to get the job done.

After the tech bubble burst, E*Trade's (NYSE: ET) Latest News about E*Trade technology chief, Lee Thompson, needed to find a way to do more with less. In 2001 and 2002, the online stock trading company shrank its tech budget by one-third. "We had to go through and figure out every penny that we were spending and make alternatives to reduce those costs," says Thompson, vice-president and chief technologist of E*Trade. So he began using software that can be downloaded at no cost via the Internet. By the end of 2002, he was saving US$13 million a year thanks to use of these freely available applications known as open source Linux MPS Pro Focus on Your Business — Not Your IT Infrastructure. Latest News about open source software.

It's 2001 all over again. With the economy in a tailspin, companies once again are under pressure to cut IT costs. Tech spending may contract 0.9 percent in 2009, according to market researcher IDC. The end of 2008 looks particularly bleak, according to an October survey by ChangeWave Research, which noted the sharpest decline for corporate software on record. About 40 percent of the 1,841 corporate software purchasers surveyed said their companies would spend less on software in the coming 90 days.